The expansion project underway in the southern Basra oil region involves building two marine pipelines and one onshore pipeline and installing four single point moorings (SPMs) for loading oil tankers at a total cost of about $1.3 billion, Shahristani said.
During a three-day visit to southern oil fields and facilities, the deputy prime minister said on Saturday Iraq expected its oil output to rise to 3 million bpd by the end of this year and saw it growing an additional 500,000 to 1 million bpd next year.
Iraq is rebuilding its oil infrastructure after years of conflict and has signed deals with major foreign oil companies to reach a proposed production capacity of 12 million bpd by 2017. Most analysts see 6-7 million bpd as more realistic.
“Until now, the obstacle to raising production has been not having enough of an export outlet to cope with the amount of crude (produced),” Shahristani told reporters aboard a work vessel operated by Australian construction firm Leighton Holdings which is handling the project.
“The export plans cope with the increase in crude production. We hope our oil contracts will boost production to around 12 million bpd and we have to have an export capacity that goes along with this production capacity,” he added.
Foster Wheeler AG is handling the project management consultancy services.
Shahristani said he expected Iraq’s oil output to reach more than 4.5-5 million bpd in three years, and then increase even faster over the next three years toward the 12 million bpd capacity objective.
He said the first two new SPMs in the southern export facility expansion project, with each SPM to have an export capacity of 900,000 bpd, would be ready by the end of this year.
“The four SPMs with the two pipelines will be finished before the middle of next year,” he said.
“But we will start exports from the first two SPMs before the end of this year.”
The other two SPMs would be installed in the first half of next year and there was a third phase to extend another sea pipeline to install a fifth SPM, Shahristani said. The fifth SPM was being financed by a Japanese government fund.
After completing the export facility expansion project, Iraq would start renovating two existing oil terminals in south Basra, the deputy prime minister said.
Shahristani said these projects would boost export capacity from Basra alone to more than six million bpd. Iraq’s current export capacity from Basra is around 1.7 million bpd.
Iraq also plans to build a strategic pipeline from the southern Basra fields through Syria and Turkey.
Eight new storage tanks are also being built in al Fao, which it was hoped could be finished by the end of this year.
